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Representations and warranties: Difference between revisions
Representations and warranties (view source)
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{{warrantydescription}} | {{warrantydescription}} | ||
===So why have both?=== | ===So why have both?=== | ||
BECAUSE THE SKY MIGHT FALL IN YOUR HEAD IF YOU DON’T, YOU DOLT. Didn’t you learn ''anything'' at law school? Wouldn’t your client rather have the option to [[rescind]] the contract (if it made a bad bargain) or sue for damages for breach (if it made a good one)? | BECAUSE [[Chicken Licken|THE SKY MIGHT FALL IN YOUR HEAD]] IF YOU DON’T, YOU DOLT. Didn’t you learn ''anything'' at law school? Wouldn’t your client rather have the option to [[rescind]] the contract (if it made a bad bargain) or sue for damages for breach (if it made a good one)? | ||
You may wonder whether the usual rules about [[concurrent liability]] in contract and tort would have something to say about that but, in Casanova’s immortal words — [[if in doubt, stick it in]]. Be a lover, not a fighter. | You may wonder whether the usual rules about [[concurrent liability]] in contract and tort would have something to say about that but, in Casanova’s immortal words — [[if in doubt, stick it in]]. Be a lover, not a fighter. | ||
===What sort of things does one represent or warrant about?=== | |||
Matters of '''fact''' inside relating to the internal workings of ones organisation that are not readily apparent to an outsider looking in, and which have a direct bearing on the enforceability of the contract. For example, that execution of the contract has been properly authorised by any internal procedures — this helps in a little way to give comfort that, if push cames to shove, the could not be set aside as not having been validly entered. This is a fanciful, [[chicken-licken]]ish fear in this day and age, but it is hardly an imposition to make this rep, so just go with it. | |||
Generally speaking matters of '''law''' are ''not'' appropriate for reps or warranties — if you want a legal opinion you should, well, get a [[legal opinion]] — but every rule is made to be broken and there are some practical exceptions: [[reps and warranties]] as to one’s own legal capacity to enter into a contract or the transaction contemplated by it are common and not really objectionable: this is technically a matter of law but is uncommonly specific to your own organisation, and is a legal “fact” which you really should know about. On the other hand, if you happen to be wrong about it, this only tends to emerge at the point where your counterparty is trying to enforce your contract and finds it cannot. This is a good example of the difference between a [[representation]] and a [[warranty]]: as a warranty, this is useless, because [[QED]] the contract needs to be enforceable to enforce the warranty that the contract is enforceable. A [[misrepresentation]] that you have the capacity to enter into the contract sounds in {{tag|tort}}, and thus doesn't rely on the [[contract]] being valid: it is a statement to a [[neighbour]] to whom one owes a [[duty of care]]. | |||
===See also=== | ===See also=== | ||
*[[Hedley Byrne]] | *[[Hedley Byrne]] | ||
*[[Negligent misstatement]] | *[[Negligent misstatement]] | ||
*[[Chicken Licken]] | |||